CIBIL Score Checklist: Improve Your Score For 2017

Start Now To Get Your Credit In Shape For 2017

Like exercising, getting results takes awhile. So if you’re CIBIL Score is low, then you better start repairing it now to get a head start on 2017! If you have any large purchases you plan to make, then it’s better to have time on your side. Your CIBIL credit score is important, as it determines whether you will get a loan or not. Many factors determine CIBIL scores, such as your credit history including how much credit you have taken in the past, your payment methods, etc.

A high CIBIL score indicates that you have a strong creditworthiness. On the other hand, a low CIBIL score represents low creditworthiness. Moreover, low credit scores will not get you a loan, as they will brand you a dicey borrower. Thus, lenders will not approve your loan applications and be reluctant about them.

Good and poor CIBIL scores

Many people, when they apply for a loan, realize that they have a low CIBIL score. They do not realize it till their loan application is rejected by the lender, which in turn tells them that they have a low credit score.

So, the question here is what really is a good CIBIL score? Let me tell you there is no predetermined score, which is termed as a good credit score. However, usually CIBIL scores of 750 and above are considered as good credit scores and can get your loan application approved. Whereas, credit scores that are below 350 are poor scores and thus can be a reason behind your loan rejection.

How to improve your CIBIL scores

People who have a poor credit history are troubled with their bad credit scores and want to know the ways through which they can improve their credit score. Although, we have talked a lot about how you can improve your CIBIL scores, in this article we will specifically focus on how you can raise your credit scores in the following year, 2017.

We have provided you with a CIBIL score checklist that can help you improve your credit score for 2017. Have a look at these ways and follow them resolutely, so that the following year can prove to be a happy credit year for you!

Improve your payment patterns: If you already have debt on your credit cards, then it is better for you to improve your payment patterns, if you want to get free of your credit card debts till 2017. Rebuild your credit history by making timely payments on your existing debt. Make sure that all outstanding amounts are entirely paid off. This, in turn, will have a positive impact on your credit report. You can also provide standing instructions to your credit card issuer to debit the dues automatically from your card account, which will diminish the chances of lapse in payments.

Offset your debts: If the major portion of your debts is of unsecured debts, then release them as soon as possible. This is because unsecured loans have a negative impact on your credit scores, whereas secured loans are favorable for your CIBIL scores. Even if you have any unsecured loans, make sure that they are of a minimum amount. If you have high unsecured debts, then they will indicate that you need personal funds from time to time and cannot generate enough savings or disposable income.

Use your credit wisely: Do not use too much available credit or your whole credit limit. Only use a maximum of 50% with the ideal amount being less than 30% of your official credit card limit. This will show that you spend your money responsibly. Moreover, if you do not use your credit at all, then also it can affect your CIBIL score negatively. When you do not have a credit history, you cannot build a nice credit score.

Do not apply for new credit: Do not apply for a fresh loan instantly from some another bank. Have patience and wait for some time. This is because when you apply for a loan at a financial institution or bank, the lender inquires about your CIBIL score. The more inquiries there are in CIBIL for your credit score, the lower your score will be. Therefore, you must avoid taking a new loan for some time or else you should get your CIBIL score yourself. When you inquire about your credit score, it will be seen as a soft inquiry and will not affect your credit score negatively. This then allows you to apply for fresh loans.

Through this checklist, you can improve your CIBIL score for 2017 easily as well as quickly. Since, still there are a few months left in 2016, you can work on your credit score and boost it for the following year, 2017.

Viveka Rao is post grad in finance and a freelance writer here at CreditSmart. A love for shopping and travel rewards has fueled her interest in personal credit, and making the most of rewards programs. She writes to educate other consumers in making great financial choices.